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Diary Road Partners v. Shell Oil Company2/1/2000
the policy; or (2) "non owned autos" used for business purposes). Because extrinsic facts reveal that Nakamura's vehicle was neither listed on the policy nor being used for a business purpose at the time of the accident, I would hold that Island has no duty to indemnify DRP.
B. Implications of the Majority's Interpretation
In my view, the Majority's interpretation of the business automobile policy blurs the potential risk pool subject to coverage that is considered in determining insurance rates. Given that a contract of insurance is an agreement in which one party (the insurer), in exchange for consideration provided by the other party (the insured), assumes the other party's risk and distributes it across a group of similarly situated insureds, it is elementary that insurers must subdivide insureds into distinct groups with similar risks. See Robert H. Jerry, Understanding Insurance Law 13-17 (2d ed. 1996). By so doing, insurers are able to distribute the risks being insured against amongst the pool of similarly situated insureds. Insurers can then set similar rates for the members of that group.
Today, despite the clear intent to limit coverage to damages arising from garage business, the Majority essentially holds that a "business" automobile insurance policy can cover damages resulting from activities unrelated to the garage's business or its operations. Specifically, the Majority's literal interpretation of the business automobile liability policy effectively destroys all limitations with respect to the vehicles subject to coverage under the policy. By so doing, the Majority has broadened beyond recognition the risk pool to which the insurer is obligated to provide coverage. Consequently, in my opinion, insurers will be forced to raise premium rates to the detriment of consumers in order to compensate for the broadened risk pool.
C. Conclusion
For the reasons discussed above, I dissent from section III.C of the Majority's Opinion.
PAULA A. NAKAYAMA, Associate Justice MARIO R. RAMIL, Associate Justice
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